Oiltek International HQU has reported net profit after tax of RM6.9 million ($2.04 million) for 1HFY2023 ended June, up 44.5% y-o-y. This translates to earnings per share of RM0.0479, says the company on July 31.
The Catalist-listed company achieved this despite revenue falling 5.7% y-o-y to RM76.7 million from its Edible and Non-Edible Oil Refinery segment, which was partially offset by an increase in revenue for the Renewable Energy segment and the Product Sales and Trading segment.
Its Edible and Non-Edible Oil Refinery segment saw decrease in revenue contribution from certain projects in Indonesia, Pakistan and Philippines, where performance obligations had been substantially satisfied in 1HFY2022.
On the other hand, revenue from the Renewable Energy segment increased 439.3% y-o-y to RM10.9 million in 1HFY2023, mainly due to an increase in revenue contribution from an ongoing project in Indonesia, which achieved a higher percentage of completion, says the company.
Its Product Sales and Trading segment also saw 16.8% higher revenue y-o-y at RM9.0 million, mainly due to an increase in demand for the supply of parts and engineering components from customers in Indonesia.
As at June 30, total assets stood at RM157.9 million, 28.9% higher y-o-y; while total liabilities were RM102.5 million, up 48.6% y-o-y.
See also: Oiltek International wins new contract worth RM19.4 million from Indonesia
As at June 30, Oiltek had RM86.9 million in cash and bank balances, 29.0% higher y-o-y.
The group’s order book rose 106.8% y-o-y in 1HFY2023. Its current order book stands at approximately RM368.5 million, with new orders amounting to RM219.9 million secured in 2023.
Oiltek says the present order book is expected to be fulfilled over the next 18 to 24 months, barring any unforeseen circumstances.
See also: Oiltek FY2022 earnings up 30.5% to RM12.7 million
Oiltek sees the push towards environmental sustainability benefitting its Renewable Energy segment. Indonesia, the world’s biggest palm oil producing country, will implement the raising of mandatory blending of biodiesel from 30% to 35% in the country, says the company, and the country will raise this to 40% “in the next few years”.
Malaysia, the world’s second largest palm oil producing country, is similarly committed to the implementation of its biodiesel programme to progressively increase biodiesel blending ratios from the current 20%.
With the aviation industry’s commitment to achieve net-zero emissions by 2050, sustainable aviation fuel presents an opportunity for Oiltek, says the company. Its processes are capable of treating and cleansing palm oil mill effluent (POME), a non-edible type of vegetable oil, as well as any other vegetable oil-based raw materials in compliance with the International Sustainability and Carbon Certification (ISCC), for use as feedstock in the production and manufacture of hydrogenated vegetable oil or aviation fuels.
Henry Yong, executive director and chief executive officer of Oiltek, says the company will focus on continuing to offer renewable energy solutions to support the sustainability efforts of its customers. “Looking ahead for the rest of the year, we will strive to acquire new orders and build on our record order book and recurring income base to drive our growth and further enhance shareholder value.”
Oiltek listed on the Singapore Exchange Catalist board in March 2022. It is a subsidary of Catalist-listed Koh Brothers Eco Engineering Limited 5HV , which holds an effective equity interest of 68.14% in Oiltek.
Koh Brothers Eco Engineering Limited issued a profit guidance on July 28, expecting to report a net loss for its 1HFY2023 ended June.
In a separate filing on the Singapore Exchange on July 31, Oiltek's board of directors says it did not contribute to Koh Brothers Eco Engineering Limited's expected net loss “at the operating level”.
Shares in Oiltek closed flat at 24 cents on July 31.
